Following the surprise introduction of an online gambling bill in mid-April, Michigan has waded right into the thick of the online gaming conversation. The state is moving quickly on the issue, and is now on everyone’s short list as the next state that could legalize online gambling.

Because Michigan has only recently emerged as an online gaming candidate, the situation has been difficult to evaluate.

Analysts and pundits are still trying to wrap their heads around where the bill, SB 889, currently stands, what obstacles – if any – it still faces, and what forces are for and against it.

In an interview with OnlinePokerReport.com on Monday, the sponsor of SB 889, Michigan State Senator Mike Kowall, shed light on some of these questions.

SB 889 faces little hostility

Even though the state’s three casinos were officially neutral towards SB 889 at the May 4 hearing, and the state’s gaming tribes have not gone on the record, the word around the campfire in Michigan is there is very little opposition to the bill.

Kowall noted that he has met with all the potential stakeholders over the past three years, and in my estimation, it seems doubtful he’d make such a serious push were the state’s commercial casinos and tribes against online gambling.

Kowall confirmed this, telling OPR that the only voices of opposition to the measure were the typical anti-gambling crowd, which he fully expected.

The senator offered his reasoning for putting forth the bill, noting the prospective revenue that could be used towards infrastructure and education, as well as the need to put consumer protections in place.

At the May 4 hearing, he pointed out that Michiganders are currently gambling at unregulated, offshore online sites, and that there is a need to make sure they’re protected.

“That genie is out of the bottle so let’s be realistic about it,” Kowall, a self-ascribed non-gambler, told OPR.

Possible obstacles

There may not be much resistance to the bill, but a lack of vocal opposition doesn’t mean obstacles don’t exist.

The good news is, unlike in California, where powerful contingents have taken hardliner positions on key issues, Michigan’s hurdles are few in number and seem manageable. Furthermore, no one with a vested interest in online gambling appears to be intractable.

The two issues that have been raised are:

Potential constitutional issues regarding tribal compacts.

The number of licenses that will be available in the state.

According to Kowall, they are already working on a draft to fix “some constitutional issues with the tribes and the tribal compacts.” This amendment should be added before the next hearing.

Another concern raised during the hearing on SB 889 held earlier this month was the limited number of licenses that would be made available. Here again, it seems this issue (if it even is an issue) is an easy fix.

“The number of licenses was just a stepping off point,” Kowall said. “We had to pick a number.”

He went on to say that they didn’t want to leave the number of licenses open-ended or limit it to one or two operators.

“We came up with the number by looking at which casinos would be more apt to buy into this,” the senator stated. Kowall said he was open to changing this down the road.

The path forward for SB 889

Facing little vocal opposition, and with only minor tweaks needed, the toughest opponent for Kowall’s online gambling bill appears to be time, and the lack of it on the legislative calendar.

The Michigan Senate and the House are expected to wrap up their legislative session by the end of June, but no firm date has been set at this point.

With only weeks left in the session, and some important legislation still being worked on, SB 889 will need to maneuver through both houses of the legislature with alacrity to get to Governor Rick Snyder’s desk before the session comes to a close.

Even with time being of the essence, Kowall is bullish on the bill’s chances.

“I’m fairly confident we can get it done,” Kowall told OPR. “There’s still time to get it out of the Senate and sent over to the House for consideration.”

Here’s how the timeline would work

Kowall indicated that another hearing for SB 889 is on tap in the near future, but likely won’t occur until the legislature finishes the budget.

“Nothing happens while we’re in the thralls of the budget,” Kowall noted, singling out the ongoing water crisis in Flint and the dilapidated state some of the state’s schools are in.

The major issues Michigan is tackling have complicated the budget process. “We found out there’s going to be a shortfall,” Kowall said, adding that this “solidifies my argument that we need to come up with some additional funding without raising taxes.”

Once the budget is done, another hearing on SB 889 should take place, during which Kowall expects the committee to vote on the bill and send it to the full senate for consideration. From there, he says it’s a matter of convincing senate leadership to bring it up for a vote on the senate floor.

If the senate passes SB 889, it would then head over to the house for consideration, where, according to Kowall, it would likely be taken up late in the session (if at all), due to the Michigan House of Representatives being up for reelection this year. The Michigan Senate is not up for reelection in 2016.

Still, Kowall is optimistic the bill will be considered in the house this year. “Once we get the questions answered with the constitutionality of it I think everything will be ok,” he indicated.

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Steve Ruddock -
Steve covers nearly every angle of online poker in his job as a full-time freelance poker writer. His primary focus for OPR is the developing legal and legislative picture for regulated US online poker and gambling.